Cytochrome P450 (CYP) constitutes a large gene superfamily descended from a single common ancestor. CYP genes are widely distributed in all domains of life from bacteria, archaea, and viruses to higher plants and animals. Because of their monophyletic nature, all CYP genes may be hierarchically classified at several distinct levels based on similarity of the protein amino acid sequences. A five-level classification (class, group, clan, family, and subfamily) is reasonably stable and useful for conceptual categorization of CYP genes. With a few exceptions, genes in a clan are specific to a kingdom or phylum, whereas cross-kingdom genes may belong to the same group, indicating an ancient origin of CYP diversification. CYP proteins are often functionally categorized into catalysts of “endogenous,” “secondary,” and “xenobiotic” compounds according to their substrate specificities. It was once postulated that xenobiotic-metabolizing enzymes were derived from an endogenous substrate-catalyzing enzyme. Although functional flow from endogenous to xenobiotic substrates occurred, recent evidence from a wide range of genomic analyses has indicated that the opposite is the more dominant stream. Expression of most vertebrate CYP genes is regulated by internal and external stimuli through transcription factors in the nuclear receptor family and bHLH-PAS family. Some aspects of cooperative evolution between transcriptional regulators and their target genes are briefly reviewed.